US loan defaults hit record level

Credit card issuers have seen higher defaults

The level of people falling behind with consumer loans in the US hit a new high in the first three months of 2009, the American Bankers Association said.

Rising unemployment was behind the missed payments, it suggested.

Delinquencies - payments that were more than 30 days overdue - rose to 3.23% from 3.22%, the highest level since rates began being tracked in the 1970s.

Credit card loan delinquencies also increased, rising to 4.75% from 4.52% in the last quarter of 2008.

The US unemployment rate is now at a 25-year high of 9.4%.

"The number one driver of delinquencies is job loss," said the ABA's chief economist, James Chessen.

"When people lose their jobs, they can't pay their bills. Delinquencies won't improve until companies start hiring again and we see a significant economic turnaround."